Berkeley boosts dividend programme by £500m

Move comes as London’s biggest homebuilder records 10 per cent profit increase

Berkeley Group, London's biggest homebuilder, boosted its dividend programme by £500 million after its adjusted profit before tax rose.

The dividends to be paid by 2021 rose to £16.34 a share from £13 because of the cash being generated from sales before completion and land, Berkeley said in a statement on Friday.

The company will pay an interim dividend of 100 pence a share, beating analyst estimates of 72 pence.

"It's not us calling the top of the market," chief executive Rob Perrins said in an interview. "The plan is to still to invest in the business. After what we think we need for investment, this is the dividend we can make."

Demand remains strong in London because of a shortage of homes and market conditions are stable, Berkeley said. Sales values gained in line with the wider market and matched cost increases, according to the statement.

Profit before tax and after one-time items rose 10 per cent to £242.3 million.

– (Bloomberg)